More on ERP and the cloud

Software as a Service (SaaS) in the enterprise has become common in areas such as customer relationship management (CRM) and human capital management (HCM). But experts say SaaS trends are branching into less commoditized software such as collaboration and business intelligence, a signal that companies are loosening their grasp on enterprise business data.

Download this free guide

The Benefits of a DevOps Approach

Bringing development and IT ops together can help you address many app deployment challenges. Our expert guide highlights the benefits of a DevOps approach. Explore how you can successfully integrate your teams to improve collaboration, streamline testing, and more.

By submitting my Email address I confirm that I have read and accepted the Terms of Use and Declaration of Consent.

By submitting your personal information, you agree that TechTarget and its partners may contact you regarding relevant content, products and special offers.

You also agree that your personal information may be transferred and processed in the United States, and that you have read and agree to the Terms of Use and the Privacy Policy.

Make no mistake: SaaS is big business. Connecticut-based consultancy Gartner Inc. estimated that SaaS revenues would be about $12 billion in 2011, with projections for it to top $20 billion by 2015. As such, all the major software vendors have their hands in the mix, pushing forward SaaS and cloud options for customers to adopt.

“More and more mission-critical data is being created outside of the firewall,” said Joshua Greenbaum, a principal consultant at Enterprise Applications Consulting in Berkeley, Calif. “So to a large extent you can almost say that it’s a no-brainer to keep it outside the firewall and use it in the cloud.”

Yet despite cloud boosters’ insistence that concerns around data privacy are overblown, they still exist. For example, the University of Massachusetts Medical School was considering setting up a private cloud with a company called OrangeScape, according to Raymond Lefebvre, the director of database and reporting systems. But they decided against it.

According to a recent SearchOracle.com reader survey, about half of Oracle IT users are not interested in hosting or cloud services. Numbers are similar for a recent SearchSAP.com survey.

How companies adopt SaaS According to experts, companies often adopt SaaS after doing a normal server hardware refresh or because a line-of-business manager wants to use a unique product or service that is available in the cloud.

When a server comes to the end of its life -- or in a grander sense, if a data center has outlived its usefulness and is running out of space or power -- a company may decide to look elsewhere to service its IT needs. SaaS might be the answer. Almost 20% of IT users in a recent SearchOracle.com survey said they were deploying or planning to deploy to the cloud to reduce data center costs. Building a data center often means a multimillion-dollar capital expense. Meanwhile, adopting SaaS allows companies to move their IT costs into the operating budget, where costs can at least appear to be much smaller.

BI and analytics is about analyzing data from disparate sources, both internal and external data. Once you have that much of the data outside of the enterprise, it makes more sense to bring it into a cloud or a SaaS environment.

Second, companies may find that their employees lead them to the cloud. A department manager may find a SaaS application that provides them with benefits they can’t get with in-house applications.

Liz Herbert, a principal analyst for Forrester Research Inc. in Cambridge, Mass., said the benefits may come from moving to a multi-tenant environment, where there are more opportunities for cooperation in areas such as supply chain management and enterprise resource planning.

“You’re not just getting a different deployment model, but you’re getting more business benefits by it being multi-tenant,” she said. “It’s with SaaS that you can do something differently.”

SaaS BI, collaboration up next Thus far, the most popular targets for SaaS have been CRM -- think Salesforce.com -- and HCM. Herbert said that is largely because CRM and HCM applications are more commoditized.

“That has meant that companies have had the most success where they can deploy something that is somewhat vanilla,” she said. “Salesforce.com and Siebel OnDemand are fairly vanilla deployments.”

According to Greenbaum, business intelligence and analytics are ripe to move toward the cloud. Why? Simply because a lot of the data companies use for analytics is already outside of their own data centers. So why not keep it there?

“BI and analytics is about analyzing data from disparate sources, both internal and external data,” he said. “Once you have that much of the data outside of the enterprise, it makes more sense to bring it into a cloud or a SaaS environment.”

0 comments

Register

Login

Forgot your password?

Your password has been sent to:

By submitting you agree to receive email from TechTarget and its partners. If you reside outside of the United States, you consent to having your personal data transferred to and processed in the United States. Privacy